"There is no expectation that the servicer will act in the best interest of consumer"
– Navient, the largest US student loan servicer.
Navient, the company the US government selected in 2004 to service all federal student loans, is being sued by the Consumer Financial Protection Bureau for systematically cheating student debtors. In response to the litigation, Navient claimed that too much was expected of them. So what if they withhold telling consumers that they had debt forgiveness options? Was it really their responsibility to act in the best of the consumer?
Isn't it? Don't financial institutions have a broader moral responsibility to guide, coach and educate the consumers they serve? Despite their responsibility to their investors, do they not see that their long-term health is inevitably tied to the prosperity of their borrowers?
One of the reasons we started Landed was that we believed there was an opportunity to create a financial institution who's success was directly tied to the financial security of the people it served.
As an educator in an expensive region, the most important determinant of financial security is getting control of your largest expense – housing costs. Unless you are ready to leave your school and move your family if rents rise, the only remaining option to control housing costs in the US is to become a homeowner.
But becoming a homeowner isn't easy – you need a financial partner. Why not a partner that willingly shares in some of the loss when things don't go the way we all hoped? Why not a partner with a financial incentive to see you succeed – to guide you, to coach you, to educate you?
Let's collectively expect more. Yes, Navient, there is an expectation that financial partners will act in the best interest of their customers. It's a shame that we've reached the point where you would dare to state the opposite on the record.